Carlsbad, San Diego County -- Dreamers have long looked to the Pacific Ocean as the ultimate answer to California's water needs: an inexhaustible, drought-proof reservoir in the state's backyard. In the last decade, proposals for about 20 desalting plants have been discussed up and down the coast.

But even with construction about to begin on the nation's largest seawater desalination facility, 35 miles north of San Diego, experts doubt that dream will ever be fully realized.

"While this Poseidon adventure may work out, I don't look for a lot of that," said Henry Vaux Jr., a UC Berkeley professor emeritus of resource economics who contributed to a 2008 National Research Council report on desalination.

The reasons boil down to money and energy. It takes a lot of both to turn ocean water into drinking water, driving the average price of desalinated supplies well above that of most other sources.

The purified water produced by the Poseidon Resources plant will cost the San Diego County Water Authority more than twice what it now pays the Metropolitan Water District of Southern California for supplies from Northern California and the Colorado River. Over the authority's 30-year contract with Poseidon, San Diego County ratepayers will pay between $3 billion and $4 billion for the desalted water, which is expected to provide no more than a tenth of their overall supply.

Not a new idea

Seawater desalination is not new to California. There are a number of small coastal plants, used mostly for research or industrial purposes, and a few, such as one on Catalina Island, that provide municipal supplies.

For reasons unique to the region, San Diego County will be the first to stick a big straw into the Pacific. It is at the end of the line for imported water, doesn't have much local groundwater and is perennially battling with Metropolitan, Southern California's wholesaler of imported supplies.

"I do believe it is worth it," said Tom Wornham, board chairman of the county water authority. "I would rather be apologizing to people in 10 years for the rate than the fact they would have no water."

Up the coast, other places have taken a pass on the Pacific. Los Angeles and Long Beach recently shelved seawater desalting plans after concluding that other water sources, such as conservation or recycling, are cheaper and easier to pursue.

Poseidon, a small, privately held company based in Stamford, Conn., started talking about developing a desalination plant in Carlsbad in late 1998. The road to construction has been so long and twisting that Global Water Intelligence, which covers the international water industry, last year listed the project among the "Top 10 Desalination Disasters" of all time.

Years of challenges

It took years for the company to get the necessary state and local permits. Environmentalists filed multiple legal challenges, the last of which was only recently resolved in Poseidon's favor. A deal with a number of local water agencies in San Diego County fell apart.

In the end, the Poseidon supplies - up to 56,000 acre-feet a year - will sell for roughly $2,000 an acre-foot, more than double the company's 2004 estimate. (One acre-foot is enough to supply two average homes for a year.) The price will rise with inflation; if energy costs go up, so will the price of water.

On the other side of the Pacific, Australia offers a sobering lesson in the perils of diving too deeply into desalination.

When years of withering drought emptied the country's reservoirs, Australia commissioned six big coastal desalting plants, including some of the world's largest.

Then the rains returned. Just as some of the operations were coming online, they were no longer needed.

Four of the six plants are being idled because cheaper water is available. Australian politicians are bemoaning the desalination binge, complaining that it saddled ratepayers with "hyper-expensive" white elephants they have to pay for regardless of whether the plants are used.

"That's certainly the risk - that we build them when they're not necessary or we build them, frankly, too soon," said Heather Cooley of the Pacific Institute, an Oakland think tank.

Santa Barbara had a similar experience in the early 1990s, when it built a desalination plant during a severe statewide drought that ended before the facility was finished. The $34 million plant, with a tenth of the capacity of the Carlsbad facility, was never used beyond the testing phase, though it could still be brought into service in an emergency.

The $954 million Carlsbad project is being financed with $781 million in tax-exempt construction bonds sold by Poseidon and the water authority. The balance is coming from investors who anticipate a return of about 13 percent. IDE Americas Inc., the subsidiary of an Israeli firm that runs some of the world's largest coastal desalination facilities in the Middle East, has been hired to design and operate the plant, slated for completion in 2016.

Complex process

The fresh water will be produced through reverse osmosis, an energy-intensive process that separates salts and contaminants from seawater by forcing it through sand filters and tightly coiled, synthetic membranes peppered with billions of tiny holes a fraction of the width of a human hair. The water will then be pumped inland - the opposite direction that drinking supplies are usually moved - requiring construction of a 10-mile underground pipeline that the water authority will own and operate.

Poseidon chose the Carlsbad location, next to the Encina Power Station, so it could draw from the power plant's cooling water discharge - avoiding the environmental harm of operating its own ocean intake.

But new federal and state environmental regulations are pushing coastal power plants to phase out the use of huge volumes of ocean water for cooling, thwarting that strategy. Poseidon expects the Encina station to be replaced within the decade with a new generating facility employing a different cooling system.